The counter-crisis economic measures announced on Saturday by President Hugo Chávez are meant to ensure that in 2009, Venezuela will have “positive indicators because the great challenge of the moment is to avoid a recession,” declared Alí Rodríguez Araque, Minister of People’s Power for Economics and Finances, to press agency AFP.
“Above zero and preferably [above] 1 and 2 percent, we would do well,” the Minister added.
Following the decline in oil prices and the global crisis of capitalism, President Chávez announced measures that would cut the 2009 budget by 6.7% and increase the value added tax (IVA) from 9% to 12%.
Furthermore, the President made new budget calculations based on a price of $40 per barrel of oil.
“We did what a good housekeeper would do: cut costs and increased income to compensate for the decline in oil prices,” Rodríguez explained.
For now, the Minister discarded measures such as the devaluation of the bolívar, which has been held in place at 2.15 per dollar since 2005, because, according to the AFP note, the costs would outweigh the benefits.
“No, [devaluation] is not advisable for the national economy. Furthermore, it is not necessary. If it were, we would make an adjustment,” Rodríguez said.
“We are an import country. We basically only export oil. Devaluation at this time would automatically make imports more expensive at a time when we have to save every dollar due to the fall in oil prices,” he added.
Rodríguez explained that the measures “respond to the reality of Venezuela at this time” and do not copy models applied by other countries.
Regarding the alleged withdrawal of foreign investment from the country, he stressed that this claim is based on propaganda and not reality.
“In oil and natural gas production each day more and more firms arrive, so I do not see where this withdrawal of investments is,” he noted.
The great challenge now is to “change the mentality of Venezuelans,” Rodríguez declared to AFP.
“Society should move from being rent-based to production-based, with a work ethic. This requires a revolution in production that should start with agriculture,” he concluded.
Agencia Bolivariana de Noticias, Embassy of the Bolivarian Republic of Venezuela Press Office / March 25, 2009